Question 1

Only a small minority of states have antitakeover statutes.

Accepted Answer

A) True 
 B)False

Question 2

Section 10(b)applies only to:

Accepted Answer

A) stock exchange listed stores. 
B) public corporations. 
C) officers, directors, and 10 percent shareholders. 
D) none of the above 
A) stock exchange listed stores. 
B) public corporations. 
C) officers, directors, and 10 percent shareholders. 
D) none of the above

Question 3

Under Sarbanes-Oxley,who cannot be a member of an audit committee of a publicly traded company?

Accepted Answer

A) officer 
B) consultant to the company 
C) outside lawyer for the company 
D) all of the above cannot be a member of the company's audit committee 
A) officer 
B) consultant to the company 
C) outside lawyer for the company 
D) all of the above cannot be a member of the company's audit committee

Question 4

What is the statute of limitations for bringing a civil law suit for securities fraud?​

Accepted Answer

A) ​180 days 
B) ​two years after the offering is made 
C) five years after the offering is made 
D) none of the above 
A) ​180 days 
B) ​two years after the offering is made 
C) five years after the offering is made 
D) none of the above

Question 5

The intrastate registration exemption requires that 100 percent of the issuer's assets be located in its resident state.

Accepted Answer

A) True 
 B)False

Question 6

Under Sarbanes-Oxley,audit committees of publicly held companies' boards need not be made up of independent members so long as the majority of the board is independent.

Accepted Answer

A) True 
 B)False

Question 7

Lund was the CEO of Verit Co.Lund was contacted by Horowitz,the CEO and Chairman of the Board of P & F.Horowitz told Lund of an opportunity P & F had to buy into a Las Vegas casino.Lund immediately purchased 10,000 shares of P & F.Three days after Lund's purchase,P & F announced its intentions to enter into a joint venture for a Las Vegas casino.Lund was then able to sell his shares for considerable profit.Discuss the propriety of Lund's actions under the 1934 Act.

Accepted Answer

Lund is a tippee.The

Question 8

Accounting firms must register annually with PCAOB if they want to audit publicly traded companies.

Accepted Answer

A) True 
 B)False

Question 9

An employee who passes along information about his company to a relative and the relative trades in that stock as a result has not violated any securities laws as long as he does not trade in the stock.

Accepted Answer

A) True 
 B)False

Question 10

A shareholder who was buying additional shares in Wayport,Inc.,told the shareholder seller "he was not aware of any bluebirds of happiness in the corporation's world." However,at the time the buyer made the statement he was aware that the CEO had informed the board via e-mail of a patent sale by Wayport that meant that the corporation would receive net proceeds of $7.6 million and would increase its year-end cash position by 22%.Which of the following statements is correct?

Accepted Answer

A) The statement was too general to constitute a basis for a 10(b) claim. 
B) The statement would need to contain numbers to be a material misrepresentation. 
C) The buyer has done nothing wrong unless he was the CEO or a member of the board. 
D) The seller has a 10(b) claim against the buyer. 
A) The statement was too general to constitute a basis for a 10(b) claim. 
B) The statement would need to contain numbers to be a material misrepresentation. 
C) The buyer has done nothing wrong unless he was the CEO or a member of the board. 
D) The seller has a 10(b) claim against the buyer.

Question 11

Which of the following is not a security for purposes of the 1933 Act?

Accepted Answer

A) a limited partnership interest 
B) a promissory note due in six months 
C) a demand note 
D) All of the above are securities. 
A) a limited partnership interest 
B) a promissory note due in six months 
C) a demand note 
D) All of the above are securities.

Question 12

The federal securities laws do not apply to proxy solicitation.

Accepted Answer

A) True 
 B)False

Question 13

Shareholder proposals that call for a shareholder vote on compensation are proper under SEC rules.

Accepted Answer

A) True 
 B)False

Question 14

Short-swing profit rules apply only to officers and directors.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is $\underline{\text{not}}$ a defense to false information in the registration statement?

Accepted Answer

A) due diligence 
B) limited time as a director 
C) purchaser knew the information was false at the time of purchase 
D) None of the above is a defense. 
A) due diligence 
B) limited time as a director 
C) purchaser knew the information was false at the time of purchase 
D) None of the above is a defense.

Question 16

A limited partnership interest is not considered a security.

Accepted Answer

A) True 
 B)False

Question 17

Municipal bonds are exempt from SEC requirements.

Accepted Answer

A) True 
 B)False

Question 18

Section 16 applies to:

Accepted Answer

A) all shareholders. 
B) only directors who also own stock. 
C) an officer of a corporation. 
D) only officers who own stock. 
E) none of the above 
A) all shareholders. 
B) only directors who also own stock. 
C) an officer of a corporation. 
D) only officers who own stock. 
E) none of the above

Question 19

The crowd funding provisions of Dodd-Frank allow the use of the Internet by businesses to raise money from nonaccredited investors without registration.

Accepted Answer

A) True 
 B)False

Question 20

The executive vice president for Best Buy appeared on television in an interview about how Best Buy was doing because of concerns about the abrupt departure of the company's CEO.The executive vice president said,"Customers are lining up at our stores and television sales are going really strong." Which of the following is correct about the EVP's statements?

Accepted Answer

A) The statement was too general to constitute a basis for a 10(b) claim. 
B) The statement does need to contain numbers to be a material misrepresentation. 
C) The buyer has done nothing wrong unless he was told to not reveal that information. 
D) The seller has a 10(b) claim against the seller. 
A) The statement was too general to constitute a basis for a 10(b) claim. 
B) The statement does need to contain numbers to be a material misrepresentation. 
C) The buyer has done nothing wrong unless he was told to not reveal that information. 
D) The seller has a 10(b) claim against the seller.

Only a small minority of states have antitakeover statutes.

Section 10(b)applies only to:

Under Sarbanes-Oxley,who cannot be a member of an audit committee of a publicly traded company?

What is the statute of limitations for bringing a civil law suit for securities fraud?

The intrastate registration exemption requires that 100 percent of the issuer's assets be located in its resident state.

Under Sarbanes-Oxley,audit committees of publicly held companies' boards need not be made up of independent members so long as the majority of the board is independent.

Accounting firms must register annually with PCAOB if they want to audit publicly traded companies.

An employee who passes along information about his company to a relative and the relative trades in that stock as a result has not violated any securities laws as long as he does not trade in the stock.

Which of the following is not a security for purposes of the 1933 Act?

The federal securities laws do not apply to proxy solicitation.

Shareholder proposals that call for a shareholder vote on compensation are proper under SEC rules.

Short-swing profit rules apply only to officers and directors.

Which of the following is $\underline{\text{not}}$ a defense to false information in the registration statement?

A limited partnership interest is not considered a security.

Municipal bonds are exempt from SEC requirements.

Section 16 applies to:

The crowd funding provisions of Dodd-Frank allow the use of the Internet by businesses to raise money from nonaccredited investors without registration.

Introduction to Law

Business Ethics and Social Responsibility

The Judicial System

Managing Disputes: Alternative Dispute Resolution and Litigation Strategies

Business and the Constitution

Administrative Law

International Law

Business Crime

Business Torts

Environmental Regulation and Sustainability

Contracts and Sales: Introduction and Formation

Contracts and Sales: Performance,Remedies,and Collection

Product Advertising and Liability

Business Competition: Antitrust

Business and Intellectual Property Law

Management of Employee Conduct: Agency

Governance and Structure: Forms of Doing Business

Management of Employee Welfare

Management: Employment Discrimination

Filters

Exam 18: Governance and Regulation: Securities Law

Only a small minority of states have antitakeover statutes.

Section 10(b)applies only to:

Under Sarbanes-Oxley,who cannot be a member of an audit committee of a publicly traded company?

What is the statute of limitations for bringing a civil law suit for securities fraud?​

The intrastate registration exemption requires that 100 percent of the issuer's assets be located in its resident state.

Under Sarbanes-Oxley,audit committees of publicly held companies' boards need not be made up of independent members so long as the majority of the board is independent.

Accounting firms must register annually with PCAOB if they want to audit publicly traded companies.

An employee who passes along information about his company to a relative and the relative trades in that stock as a result has not violated any securities laws as long as he does not trade in the stock.

Which of the following is not a security for purposes of the 1933 Act?

The federal securities laws do not apply to proxy solicitation.

Shareholder proposals that call for a shareholder vote on compensation are proper under SEC rules.

Short-swing profit rules apply only to officers and directors.

Which of the following is not‾\underline{\text{not}}not​ a defense to false information in the registration statement?

A limited partnership interest is not considered a security.

Municipal bonds are exempt from SEC requirements.

Section 16 applies to:

The crowd funding provisions of Dodd-Frank allow the use of the Internet by businesses to raise money from nonaccredited investors without registration.

Introduction to Law

Business Ethics and Social Responsibility

The Judicial System

Managing Disputes: Alternative Dispute Resolution and Litigation Strategies

Business and the Constitution

Administrative Law

International Law

Business Crime

Business Torts

Environmental Regulation and Sustainability

Contracts and Sales: Introduction and Formation

Contracts and Sales: Performance,Remedies,and Collection

Product Advertising and Liability

Business Competition: Antitrust

Business and Intellectual Property Law

Management of Employee Conduct: Agency

Governance and Structure: Forms of Doing Business

Management of Employee Welfare

Management: Employment Discrimination

Filters

What is the statute of limitations for bringing a civil law suit for securities fraud?

Which of the following is $\underline{\text{not}}$ a defense to false information in the registration statement?